Leading Barclays' boss rejects lending targets plan

A leading Barclays’ boss today rejected British Government plans to impose targets for lending to small businesses.

Despite ministers’ fears that a drought in credit is threatening the economic recovery, Steve Cooper, head of Barclays’ small business division, said he would not want to comply with lending targets.

Mr Cooper told the Financial Times: “I’m not going to sign up to a target. I don’t want to create an expectation that if Barclays said no yesterday it could say yes tomorrow (because it has a target to achieve).”

Barclays’ part-nationalised rivals Lloyds Banking Group and Royal Bank of Scotland have agreed to lending targets – but last month business secretary Vince Cable unveiled plans to widen these agreements to other UK banks.

The government wants banks, which have racked up £15bn in half-year profits, to use their gains to increase the flow of credit rather than handing out bumper bonuses and dividends.

But the banks believe the problem is one of demand for credit, not supply, and Mr Cooper’s dismissal of the proposed lending targets follows a similar rejection from HSBC earlier in the month.